Crude oil futures were weaker, below $100 early Thursday, as worries over the European debt crisis obscured gains spurred by a larger-than-expected drop in new claims for U.S. jobless benefits.
Crude oil futures were weaker, below $100 early Thursday, as worries
over the European debt crisis obscured gains spurred by a larger-than-expected
drop in new claims for
U.S.
jobless benefits.
The Labor Department said new claims in the week ended Dec. 3 fell by 23,000
and were at the lowest level in nine months. Economists had expected a 7,000
decline in the week.
All eyes are on
Brussels
,
where European leaders begin a two-day summit meeting, seeking a solution to
sovereign debt crisis. The market has been gripped by concerns in recent months
that the crisis in
Europe
could trigger a global
economic slowdown.
The European Central Bank, as expected, lowered its key lending rate Thursday
by 0.25 percentage point to a historical low amid growing worries of a
recession. But equities and oil prices retreated after ECB President Mario
Draghi appeared to pour cold water on investor hopes for more bond purchases.
"The situation in
Europe
swings between optimism and pessimism every single day," said Tom Bentz,
director at BNP Paribas Prime Brokerage in
New
York
. "Lately, the market has built in a lot of
optimism and I'm afraid of a let down."
Light, sweet crude oil for January delivery on the New York Mercantile Exchange
was 72 cents lower at $99.77 a barrel. The contract traded to a high of
$101.73, lifted by the jobless news. ICE North Sea Brent crude oil for January
was 77 cents lower at $108.76 a barrel.
"There is a need for
Europe
to
come out with a firm statement and say we are banding together to tackle
this," said Carl Larry, president of Oil Outlooks and Opinions, an energy
advisory group.
Larry said Brent crude, widely used in
Europe
, is
vulnerable to big declines if
Europe
can't
address the crisis.
The price swings come against an increasingly bearish fundamental outlook in
the
U.S.
,
where inventories of crude oil, gasoline and distillate (diesel/heating oil)
rose in the past week.
Nymex heating oil for January delivery was 0.42 cent lower at $2.9782 a gallon.
Reformulated gasoline blendstock futures were 1.39 cents lower at $2.573 a
gallon.
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